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Thomas M. Anichini, CFA, Chief Investment Strategist

Recent Posts

Target Date Funds: What Are They, and How Do They Work?

Posted by Thomas M. Anichini, CFA, Chief Investment Strategist on Nov 30, 2018 10:00:17 AM

Typically, 1/3 or more of the investment choices available in a retirement plan are target date mutual funds. What is a target date fund? How do target date funds work? This article will address those questions and discuss target date funds’ benefits and shortcomings.

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Topics: target date funds, Saving for Retirement, what is a target date fund, target date mutual funds, Target Date Funds for Retirement, target date retirement funds

Investor Returns: Chasing the Market Can Mean Less For Your Future

Posted by Thomas M. Anichini, CFA, Chief Investment Strategist on Sep 21, 2018 10:07:44 AM

Businesswoman standing with umbrella keeping orange arrow concept on background-1

For all the challenges investors face when saving for retirement, one of the easiest ways they can undermine their own efforts is by chasing what’s hot – whether that means chasing certain fund categories or specific funds. One measure of the effect of investor behavior as it pertains to a particular fund is the fund’s investor return. The investor return measures how a fund’s investors performed. This article discusses why investor returns (as represented by Morningstar Investor Return™[1] (MIR)) are different from fund returns and concludes with takeaways and advice for consumers.

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Topics: working retirement, All, Saving for Retirement, market downturn, investing for retirement, what returns investors expect, investor returns, investment loss, fund returns

Asymmetric vs. Symmetric Risk Preferences and Optimal Portfolio Selection

Posted by Thomas M. Anichini, CFA, Chief Investment Strategist on May 9, 2018 12:22:08 PM

assymetric imageWhile every investment practitioner knows (or should know) how to derive an efficient frontier under Modern Portfolio Theory (MPT), ask the next investment professional you meet how to select the most appropriate portfolio from the frontier. Chances are they won’t remember. The answer, of course, is to select the one that maximizes expected utility.

What the heck does “maximize expected utility” mean?

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Topics: behavioral finance, Business Insights, risk vs reward, BiCRRA, efficient frontier, CRRA, Relative Wealth Ratio, scoring of losses relative to gains, risk return tradeoff, portolio risk, assymetric risk, risk-neutral scoring

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